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IV DRAFT ESTIMATES FOR 1974-75 IN RELATION TO THE THREE YEAR
FORECAST, 1975-76 TO 1977-78 AND TO AN ORDER OF COST OF PROJECTED CAPITAL WORKS, 1974-75 TO 1983-84.
EXPENDITURE
RECURRENT EXPENDITURE : FORECAST TO INCREASE AT 7 1/2 ANNUALLY TO
HK DOLLARS 4,843 MILLION (AT 1974 PRICES) IN 1977-78.
TEN YEAR ORDER OF COST OF PROJECT CAPITAL WORKS:
HK DOLLARS 25,000 MILLION AT 1974 PRICES, PUBLIC HOUSING AND THE THREE NEW TOWNS ACCOUNT FOR 37 PRE CENT, ROADS
FOR 14 PER CENT AND WATER DEVELOPMENT FOR 9 PER CENT
AND OTHER PUBLIC WORKS FOR 24 PER CENT.
FINANCING OF CAPITAL EXPENDUTURE.
AT CURRENT TAX RATES AND ON THE BASIS OF CERTAIN
ASSUMPTIONS AS TO GROWTH OF RECURRENT REVENUE, THE
ANNUAL SURPLUS ON RECURRENT ACCOUNT AND CAPITAL
REVENUE, THE RESOURCES AVAILABLE TO MEET THIS CAPITAL
EXPENDITURE MAY BE ASSUMED TO BE HK DOLLARS 18,000 MILLION, 1.E. HK DOLLARS 7,000 MILLION LESS THAN
ESTIMATED COST. IT IS DIFFICULT TO THINK IN TERMS OF
EXPENDITURE AND RESOURCES SO FAR AHEAD. BUT THE GOVERN-
MENT MUST CONSIDER NOW THE DIFFERENCE BETWEEN EXPENDITURE
AND RESOURCES OVER THE PERIOD OF THE THREE YEAR FORECAS
THIS DIFFERENCE IS HK DOLLARS 4,000 OF WHICH HK DOLLARS 2,040 MILLION COULD BE FOUND BY VARIOUS MEANS,
LEAVING HK DOLLARS 1,960 MILLION WHICH CAN BE ELIMINATED ONLY BY POSTPON!ING EXPENDITURE. ON THIS BASIS, ACCEPTADE
AVERAGE ANNUAL CAPITAL EXPENDITURE OVER THE THREE
FORECAST YEARS WOULD BE HK DOLLARS 2,480 MILLION OF WHICH HK DOLLARS 2,200 MILLION WOULD BE CAPITAL EXPEN- #TURE BY THE PUBLIC WORKS DEPARTMENT AND THE HOUSING AUTHORITY. A COMPREHENSIVE STUDY IS BEING UNDERTAKEN TO ANSWER THE QUESTIONS: WOULD EXPENDITURE OF THIS MAGNITUDE LEAD TO INFLATIONARY PRESSURES BECAUSE THE
CAPACITY OF THE BUILDING AND CONSTRUCTION INDUSTRY IS LIMITED? AND MIGHT THE ECONOMY AS A WHOLE SUFFER AS RESOURCES WERE DIVERTED AWAY FROM EXPORT ORIENTATED
MANUFACTURING INDUSTRIES?
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THE VARIOUS
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